Merrill, Goldman Accidentally Release Short-Selling Docs

Law360, New York (May 16, 2012, 3:17 PM EDT) -- Merrill Lynch & Co. and Goldman Sachs Group Inc. made public, evidently by accident, documents that they had sought to have sealed in a dismissed lawsuit in California state court alleging the firms conspired to engage in “naked” short selling of Overstock.com Inc. shares.

The uncovered documents, released last week, include an email in which an executive at Merrill, which was acquired by Bank of America in 2008, explicitly told others to ignore compliance rules and reveal insiders discussing plans to deliberately fail to settle client...